Integrated Report 2020

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Revenues and ExpensesLooking at the global economy in the fiscal year under review, in the United States conditions remained solid against a background of favorable employment and income environments, while in Europe consumer spending registered moderate expansion. In China, the economy continued to experience deceleration in both overseas and domestic demand due to U.S.-China trade friction. Meanwhile, Japan saw a recovery in the employment and income environments. However, there was a slowdown in exports resulting from deceleration in overseas economies, as well as damage from natural disasters, such as large typhoons, and a consumption tax hike, leading to sluggish consumer spending. Furthermore, global economic circumstances became even more challenging due to the spread of COVID-19 toward the end of the fiscal year under review.In this business environment, LINTEC’s net sales declined 4.1% year on year, to ¥240.7 billion, due to such factors as the slump in the semiconductor market in the first half of the fiscal year. Despite a decline in the cost of pulp, a key raw material, operating income was down 14.1% year on year, to ¥15.4 billion, as a result of a decrease in sales quantity and other factors. Profit before income taxes was down 24.0% year on year, to ¥13.9 billion in the fiscal year under review, due in part to the decline in operating income and the recording of an impairment loss of goodwill of ¥0.5 billion. Income taxes following the application of tax effect accounting were ¥4.4 bil-lion, and profit attributable to owners of parent was down 25.6%, to ¥9.6 billion. Net income per share decreased from ¥179.24 in the pre-vious fiscal year to ¥133.20, and ROE declined from 6.9% to 5.0%.Performance by Business SegmentPrinting and Industrial Materials ProductsIn Printing & Variable Information Products Operations, looking at adhesive products for labels, due to unseasonable weather condi-tions in Japan, weak domestic sales were recorded by display labels for food- and beverage-related applications and by eye-catching labels for cosmetics. Overseas, the economic slow-down in China had an influence, but sales activities to develop new customers in the United States were effective. Accordingly, over-seas results were firm. In Industrial & Material Operations, sales of window films were favorable in Japan and overseas, but sales of motorcycle- and automobile-use adhesive products were sluggish due to the effects of the stagnant Indian market.As a result, the segment’s net sales were down 0.4% year on year, to ¥122.4 billion, and operating income declined 75.3%, to ¥0.9 billion, due in part to the worsening of the sales mix and higher raw materials and distribution costs.Electronic and Optical ProductsIn Advanced Materials Operations, sales of semiconductor-related adhesive tapes increased due primarily to a recovery in demand in the third quarter. However, sales of semiconductor-related equip-ment decreased significantly as a result of the influence of restrained capital expenditures. Also, in multilayer ceramic capac-itor-related tapes, as a result of the influence of production adjust-ments for products for automobiles and smartphones, overall sales of related tapes registered a substantial decline. In Optical Products Operations, looking at optical display-related adhesive products, sales of products for larger TV units were firm. However, sales of products for small- and medium-sized items, such as smartphones, were weak, reflecting lackluster demand.As a result, the segment’s net sales were down 9.3% year on year, to ¥81.9 billion, while operating income declined 1.5%, to ¥11.0 billion.Paper and Converted ProductsIn Fine & Specialty Paper Products Operations, sales of mainstay color papers for envelopes performed solidly. In addition, con-struction material papers and oil- and water-resistant papers for fast food also sold well.Net SalesOperating Income¥ Billion¥ Billion(Fiscal years ended March 31)(Fiscal years ended March 31)250.9240.7Printing and Industrial Materials Products–0.5Electronic and Optical Products–8.4Paper and Converted Products–1.32020201918.015.4Printing and Industrial Materials Products–2.8Electronic and Optical Products–0.2Paper and Converted Products+0.5Adjustment–0.12020201968Financial InformationLINTEC Integrated Report 2020Management’s Discussion and Analysis